From The Editor | February 4, 2014

From RSPA INSPIRE: Many Resellers Devoid Of Ownership, Leadership Abilities

By Jim Roddy, president, Business Solutions magazine and Integrated Solutions For Retailers magazine

A frequent complaint I’ve heard from channel vendors — including a few times this week at the RSPA INSPIRE Thought Leadership Summit in Puerto Rico — is that many resellers lack fundamental business management knowledge and skills. For example, when talking about the need to shift to the as-a-Service business model, the owner of the small reseller business isn’t familiar with business models in general and doesn’t track his company’s financial performance.

One goal of Tuesday’s education session at INSPIRE was to take steps towards educating resellers on some fundamental business management principles. Arlin Sorensen, founder and CEO of the channel-focused HTG Peer Groups, led the group of approximately 70 channel executives in a discussion on the five hats channel executives must wear: Owner, Leader, Manager, Team, and Individual.

I’ll expand upon what I feel are the two most crucial responsibilities — Owner and Leader — and share some highlights from Sorensen’s talk.

Owner

Hard work does not necessarily equate with value. Value is determined by what we build. “This is the greatest truth for owners,” Sorensen said, and he placed the job of building value squarely at the feet of the business owner. “If you don’t create the value in your small business, no one else is going to do it. Your employees don’t think about building value.”

Sorensen recommended that owners regularly block out time to strategize how to build value. “Are you spending time creating value in your organization?” he asked. “A lot of us get stuck selling, fixing, doing relationship stuff. We have to think like a CEO and spend some solitude time. Get away from the chaos and think about where you’re going as an organization.”

Sorensen and his HTG team members detailed an ownership scorecard that focused on not just profits but consistently profitable monthly recurring revenue. “If you want to sell your business, there needs to be something to sell there,” Sorensen said. He recommended building up your list of profitable contractual agreements, not just a list of profitable projects you’ve already completed.

Sorensen shared a slide that stated, “The number one task of a true leader is to create more leaders,” then he asked the group, “Who are you building that can step up and sit in your seat?”

“A leader’s number one task is to put himself or herself out of a job,” Sorensen said. “It doesn’t just happen by osmosis or luck. We need to be intentional.”

Another Sorensen quote: “Leadership isn’t just about the person at the top of the organizational chart. The primary purpose of a leader is to take people somewhere, and lot of times people can’t follow us because we haven’t truly communicated where we are going and what we need to do.”

Sorensen and HTG also said effective leaders form working groups inside their company to hash out important decisions. “You should argue and fight and have a really good debate and all come out united where you’re heading,” he said. “Take your team with you when you’re doing strategic planning — including the people who are customer-facing and will do much of the execution.”